UC RUSAL might halt production at five smelters in 2013
8 August 2013 (10:50)
August 8, 2013. UC RUSAL might halt its electrolysis production facilities at five smelters of its West Aluminum Division (Volgogradsky, Ural, Bogoslovsky, Nadvoitsky, and Volkhovsky smelters) until the price of aluminum goes back to $2,400 per 1,000kg, Interfax refers to the company's Director-General Oleg Deripaska as saying.
According to Deripaska, the loss-making enterprises in the Urals and the North-West of Russia are now fully subsidized by the profit-making plants in Siberia.
'It is already obvious that we cannot keep the prime cost of our produce at the same level: the monopolies have gone through with a price increase yet again, and we find we have no reserves to keep the prime cost down. So we have to make adjustments to our plans on production increase in order to protect our companies in Siberia that are still profitable. And we cannot afford to wait,' he added.
Deripaska says last year's agreement with Sverdlovsk Region Government and the local trade unions regarding a Foreign Trade Bank loan to upgrade foundry divisions at Ural and Bogoslovsky smelters was actually signed on the basis of forecast aluminum prices ($2,100 to $2,200 per 1,000kg).
'The agreement will go through, and RUSAL will launch upgrades and modernization as soon as the market situation improves. This is exactly why a temporary halt was coordinated at some of our enterprises and not a closing down of business,' Oleg Deripaska said.
According to Deripaska, the loss-making enterprises in the Urals and the North-West of Russia are now fully subsidized by the profit-making plants in Siberia.
'It is already obvious that we cannot keep the prime cost of our produce at the same level: the monopolies have gone through with a price increase yet again, and we find we have no reserves to keep the prime cost down. So we have to make adjustments to our plans on production increase in order to protect our companies in Siberia that are still profitable. And we cannot afford to wait,' he added.
Deripaska says last year's agreement with Sverdlovsk Region Government and the local trade unions regarding a Foreign Trade Bank loan to upgrade foundry divisions at Ural and Bogoslovsky smelters was actually signed on the basis of forecast aluminum prices ($2,100 to $2,200 per 1,000kg).
'The agreement will go through, and RUSAL will launch upgrades and modernization as soon as the market situation improves. This is exactly why a temporary halt was coordinated at some of our enterprises and not a closing down of business,' Oleg Deripaska said.
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